K. NON BORROWER INCOME
Income from a non-borrower who also occupies the property may be used to support payments under all loss mitigation options with the following restrictions:
- Occupancy must be fully verified
- Servicer should conduct a financial review of the entire household income and expenses to determine if there is sufficient surplus income to pay back the arrearages
- Servicers should consult their legal counsel to determine if the asset is eligible for loss mitigation since the Non-Borrower is not on the original mortgage
- When a borrower uses a non-borrower household member’s income in qualifying for a loss mitigation home retention option and that non-borrower household member will be included on the modified note, the non-borrower household member must sign all required loss mitigation documentation.
Additional Resource: https://www.rd.usda.gov/files/3555-1chapter18.pdf